August 22, 2023

The Australian road freight market is ready to digitise

The time is now to revolutionise logistics in Australia. Are you ready to be the change agent the industry needs?

The Australian road freight market is ready to digitise | Ofload

In today’s dynamic logistics landscape, marked by time-slot deliveries, click-and-collect services and a heightened focus on supply chain transparency, consumer demand is moving at an unprecedented pace. And with demand, the road freight industry continues to grow. 

Yet despite this growth, logistics companies often find themselves grappling with inefficiencies that hinder progress- whether that be increased overheads or excess warehouse stock. 

With no signs of slowing growth, the pursuit for an efficient supply chain has never been more critical. 

Unlocking the Potential of the Long-Tail

In the context of a $USD3-4 trillion global road freight market, Australia over-indexes (vs. population, GDP) with a $AUD66 billion local road freight market today. 

Australia's road freight market is currently valued at AUD$66 billion. Within this expansive landscape, an astounding 58,000 trucking companies operate, the majority (92%) of which are small, often owner-operated businesses. This long-tail evidently plays a pivotal role in the industry, yet its full potential remains largely untapped. 

In other words, this high fragmentation means that the industry is operating inefficiently. Surprisingly, a staggering 30% of trucking kilometres in Australia are travelled empty, with vehicles idling for a whopping 50% of their operational time.

And these inefficiencies are exacerbated by the industry’s continued use of traditional analog practices, with crucial logistics functions reliant on pen-and-paper processes. From load management to payment handling, this means businesses focus precious time on admin operations and often end up paying excess overheads.

A graphic displaying Australian road freight market fragmentation.

Navigating the Tech Terrain

The road to efficiency starts with embracing technology as an enabler of change. Tech can work together with current business processes to streamline operations and uncover opportunities for backhauling, consolidated shipments, and reduced empty kilometres. This not only maximises efficiency by leveraging the long-tail, but also minimises fuel consumption, reduces manual tasks and empowers businesses with informed decision-making.

The good news - fortunately, you don't need a huge budget for a major overhaul. Simple steps can quickly yield significant results. Consider these practical measures, regardless of your budget:

1. Invest in digital infrastructure

Implementing modern technology requires a solid foundation. We need reliable hardware, secure networks, and scalable cloud-based systems to handle the vast amounts of data generated in the freight industry. This infrastructure will serve as the backbone of this industry’s digital transformation journey.

2. Embrace data-driven decision-making

Data is only as valuable as the insights that you make from it.  Advanced analytics, machine learning, and AI extract valuable insights from real-time data, enabling swift responses to changing customer demands and optimised resource allocation. In our current digital age, these tools can be inexpensive to implement and easy to operate.

3. Foster collaboration

No single player can solve the challenges of the logistics industry alone. Collaboration is key. Forge partnerships with carriers, shippers, warehouses, and tech providers. Shared data, aligned processes, and integrated systems create a seamless supply chain ecosystem. Don’t underestimate the experience and knowledge that comes from your carrier network; they are an integral part of the process and have a wealth of practical knowledge.

4. Upskill your workforce

Embracing technology means building the skills to best use it. Equip employees with the skills needed to leverage technology, adapt to new processes, and drive innovation within your company. Look into the skills you already have within the organisation. It’s not necessarily about hiring new, but rather optimising the talent you have already.

5. Cultivate a culture of innovation

Technology is ever-evolving, and so must we be. Encourage a culture of innovation within your organisation, where ideas are welcomed, and experimentation is encouraged. Foster an environment that rewards creativity, problem-solving, and collaboration. This will be the catalyst for transformative change.

These steps collectively can make a huge difference to driving efficiencies. The road to a more resilient and environmentally conscious logistics industry lies before us. By embracing technology, fostering innovation, and tapping into the potential of the long-tail of trucking companies, we have the power to reshape the landscape of logistics.

The time is now to revolutionise logistics in Australia. Are you ready to be the change agent the industry needs? 

Ofload is a digital freight platform that aims to empower the long tail of small carriers to access large shipper contracts through technology. Our focus is eliminating waste across all aspects of the freight industry through prioritising transparency and efficiency. 

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